Loans and Related Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2018

The following table summarizes the primary segments of the loan portfolio at March 31, 2018 and December 31, 2017:



(in thousands)	Commercial Real Estate		Acquisition and Development		Commercial and Industrial		Residential Mortgage		Consumer		Total
March 31, 2018

Individually evaluated for impairment	$	6,528	$	930	$	317	$	4,244	$	25	$	12,044
Collectively evaluated for impairment	$	290,268	$	106,365	$	81,330	$	414,201	$	33,285	$	925,449
Total loans	$	296,796	$	107,295	$	81,647	$	418,445	$	33,310	$	937,493

December 31, 2017

Individually evaluated for impairment	$	9,076	$	976	$	668	$	4,201	$	30	$	14,951
Collectively evaluated for impairment	$	274,086	$	109,554	$	76,055	$	394,447	$	23,425	$	877,567
Total loans	$	283,162	$	110,530	$	76,723	$	398,648	$	23,455	$	892,518

Classes of the Loan Portfolio Summarized by the Aggregate Risk Rating

The following table presents the classes of the loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention and Substandard within the internal risk rating system at March 31, 2018 and December 31, 2017:


(in thousands)	Pass		Special Mention		Substandard		Total
March 31, 2018
Commercial real estate
Non owner-occupied	$	141,575	$	0	$	4,001	$	145,576
All other CRE		140,024		4,510		6,686		151,220
Acquisition and development
1-4 family residential construction		17,531		0		0		17,531
All other A&D		81,825		7,378		561		89,764
Commercial and industrial		80,594		0		1,053		81,647
Residential mortgage
Residential mortgage - term		339,614		0		4,958		344,572
Residential mortgage - home equity		72,581		147		1,145		73,873
Consumer		33,215		5		90		33,310
Total	$	906,959	$	12,040	$	18,494	$	937,493

December 31, 2017
Commercial real estate
Non owner-occupied	$	133,725	$	0	$	5,843	$	139,568
All other CRE		132,003		3,963		7,628		143,594
Acquisition and development
1-4 family residential construction		17,719		0		0		17,719
All other A&D		84,345		7,294		1,172		92,811
Commercial and industrial		75,299		17		1,407		76,723
Residential mortgage
Residential mortgage - term		319,059		0		5,326		324,385
Residential mortgage - home equity		73,059		148		1,056		74,263
Consumer		23,391		5		59		23,455
Total	$	858,600	$	11,427	$	22,491	$	892,518

Loan Portfolio Summarized by the Past Due Status

The following table presents the classes of the loan portfolio summarized by the aging categories of performing loans and non-accrual loans at March 31, 2018 and December 31, 2017:



(in thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days+ Past Due		Total Past Due and Accruing		Non-Accrual		Total Loans
March 31, 2018
Commercial real estate
Non owner-occupied	$	143,999	$	0	$	0	$	0	$	0	$	1,577	$	145,576
All other CRE		150,676		127		27		0		154		390		151,220
Acquisition and development
1-4 family residential construction		17,531		0		0		0		0		0		17,531
All other A&D		82,204		7,393		0		0		7,393		167		89,764
Commercial and industrial		81,276		340		0		5		345		26		81,647
Residential mortgage
Residential mortgage - term		341,041		1,745		344		0		2,089		1,442		344,572
Residential mortgage - home equity		72,676		378		54		91		523		674		73,873
Consumer		33,064		167		42		12		221		25		33,310
Total	$	922,467	$	10,150	$	467	$	108	$	10,725	$	4,301	$	937,493

December 31, 2017
Commercial real estate
Non owner-occupied	$	136,134	$	186	$	0	$	0	$	186	$	3,248	$	139,568
All other CRE		141,680		461		248		0		709		1,205		143,594
Acquisition and development
1-4 family residential construction		17,719		0		0		0		0		0		17,719
All other A&D		92,291		0		165		144		309		211		92,811
Commercial and industrial		76,322		0		17		6		23		378		76,723
Residential mortgage
Residential mortgage - term		319,633		322		2,534		430		3,286		1,466		324,385
Residential mortgage - home equity		72,683		600		400		0		1,000		580		74,263
Consumer		23,273		115		22		15		152		30		23,455
Total	$	879,735	$	1,684	$	3,386	$	595	$	5,665	$	7,118	$	892,518

Primary Segments of the Allowance for Loan Loss

The following table summarizes the primary segments of the ALL at March 31, 2018 and December 31, 2017, segregated by the amount required for loans individually evaluated for impairment and the amount required for loans collectively evaluated for impairment:


(in thousands)	Commercial Real Estate		Acquisition and Development		Commercial and Industrial		Residential Mortgage		Consumer			Unallocated	Total
March 31, 2018

Individually evaluated for impairment	$	633	$	30	$	10	$	141	$	7	$	0	$	821
Collectively evaluated for impairment	$	3,343	$	1,130	$	850	$	3,537	$	289	$	500	$	9,649
Total ALL	$	3,976	$	1,160	$	860	$	3,678	$	296	$	500	$	10,470

December 31, 2017

Individually evaluated for impairment	$	245	$	40	$	0	$	65	$	12	$	0	$	362
Collectively evaluated for impairment	$	3,454	$	1,217	$	869	$	3,379	$	191	$	500	$	9,610
Total ALL	$	3,699	$	1,257	$	869	$	3,444	$	203	$	500	$	9,972

Impaired Loans and Related Interest Income by Loan Portfolio Class

The following table presents impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary at March 31, 2018 and December 31, 2017:


		Impaired Loans with Specific Allowance				Impaired Loans with No Specific Allowance		Total Impaired Loans
(in thousands)		Recorded Investment		Related Allowances		Recorded Investment		Recorded Investment		Unpaid Principal Balance
March 31, 2018
Commercial real estate
Non owner-occupied	$	1,648	$	633	$	54	$	1,702	$	8,663
All other CRE		0		0		4,826		4,826		4,826
Acquisition and development
1-4 family residential construction		0		0		527		527		527
All other A&D		236		30		167		403		571
Commercial and industrial		10		10		307		317		2,531
Residential mortgage
Residential mortgage - term		788		104		2,782		3,570		3,883
Residential mortgage – home equity		85		37		589		674		687
Consumer		25		7		0		25		25
Total impaired loans	$	2,792	$	821	$	9,252	$	12,044	$	21,713

December 31, 2017
Commercial real estate
Non owner-occupied	$	1,711	$	245	$	1,907	$	3,618	$	10,579
All other CRE		0		0		5,458		5,458		5,731
Acquisition and development
1-4 family residential construction		0		0		527		527		527
All other A&D		295		40		154		449		722
Commercial and industrial		0		0		668		668		2,882
Residential mortgage
Residential mortgage - term		598		65		3,023		3,621		3,919
Residential mortgage – home equity		0		0		580		580		593
Consumer		30		12		0		30		30
Total impaired loans	$	2,634	$	362	$	12,317	$	14,951	$	24,983

Allowance for Loan Losses Summarized by Loan Portfolio Segments

The following tables present the activity in the ALL for the three-month periods ended March 31, 2018 and 2017:


(in thousands)	Commercial Real Estate		Acquisition and Development		Commercial and Industrial		Residential Mortgage		Consumer			Unallocated	Total
ALL balance at January 1, 2018	$	3,699	$	1,257	$	869	$	3,444	$	203	$	500	$	9,972
Charge-offs		0		(91)		0		(154)		(68)		0		(313)
Recoveries		59		214		18		38		35		0		364
Provision		218		(220)		(27)		350		126		0		447
ALL balance at March 31, 2018	$	3,976	$	1,160	$	860	$	3,678	$	296	$	500	$	10,470

ALL balance at January 1, 2017	$	3,913	$	871	$	858	$	3,588	$	188	$	500	$	9,918
Charge-offs		(429)		(18)		(33)		(148)		(84)		0		(712)
Recoveries		5		11		1,455		220		77		0		1,768
Provision		2,078		19		(1,344)		(158)		14		0		609
ALL balance at March 31, 2017	$	5,567	$	883	$	936	$	3,502	$	195	$	500	$	11,583

Average of Impaired Loans and Related Interest Income by Loan Portfolio Class

The following table presents the average recorded investment in impaired loans by class and related interest income recognized for the periods indicated:


	Three months ended						Three months ended
	March 31, 2018						March 31, 2017
(in thousands)	Average investment		Interest income recognized on an accrual basis		Interest income recognized on a cash basis		Average investment		Interest income recognized on an accrual basis		Interest income recognized on a cash basis
Commercial real estate
Non owner-occupied	$	2,660	$	4	$	66	$	6,366	$	6	$	0
All other CRE		5,142		49		56		9,320		53		0
Acquisition and development
1-4 family residential construction		527		6		0		582		6		0
All other A&D		426		3		0		1,891		23		0
Commercial and industrial		493		5		0		290		3		0
Residential mortgage
Residential mortgage - term		3,595		32		0		4,018		33		0
Residential mortgage – home equity		627		0		7		224		0		0
Consumer		28		0		0		0		0		0
Total	$	13,498	$	99	$	129	$	22,691	$	124	$	0

Modification of Troubled Debt Restructuring by Class

During the three months ended March 31, 2018, there were no new TDRs, no modifications on existing TDRs and no payment defaults.

During the three months ended March 31, 2017, there were no new TDRs and two existing TDRs which had reached their original modification maturity were re-modified. These re-modifications did not impact the ALL. During the three months ended March 31, 2017, there were no payment defaults. The following table presents the volume and recorded investment at the time of modification of TDRs by class and type of modification that occurred during the three months ended March 31, 2017:


	Temporary Rate Modification			Extension of Maturity			Modification of Payment and Other Terms
(in thousands)	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
Three months ended March 31, 2017
Commercial real estate
Non owner-occupied	0	$	0	0	$	0	0	$	0
All other CRE	0		0	0		0	0		0
Acquisition and development
1-4 family residential construction	0		0	0		0	0		0
All other A&D	0		0	1		244	0		0
Commercial and industrial	0		0	0		0	0		0
Residential mortgage
Residential mortgage – term	0		0	1		259	0		0
Residential mortgage – home equity	0		0	0		0	0		0
Consumer	0		0	0		0	0		0
Total	0	$	0	2	$	503	0	$	0